Best credit cards for renting a car

Planning to rent a car during your summer sojourns? Depending on which credit card you use, you may be able to – safely – decline additional rental insurance.

One of the most profitable areas for rental car companies is their supplemental rental insurance; that’s why many companies are quite aggressive about selling it. However, as many drivers already know, personal car insurance often covers cars rented for leisure travel. And even if yours does not, the coverage provided by the credit card you carry just might.

Best credit card issuers
Recently, commissioned a study to see which major credit cards offer the best protection and detailed the results in its released its 2017 Credit Card Rental Car Insurance Study.

“Policies generally cover cardholders in the event of damage to or theft of a rental car,”WalletHub saiad on its website, but noted that renters “have to decline a rental company’s supplemental insurance policy for it to work.”

That means renters have to know that this perk exists, and what kind of coverage their credit card provides in order to take advantage of it.

A few of the highlights of that study are these:
  • Credit cards issued by Citibank (NYSE:C) have the most favorable rental car insurance policies.
  • Vacationers should avoid renting a truck, open-bed vehicle, exotic/antique car, large van or full-size SUV if you want credit-card coverage, as many cards exclude them. 
  • Nearly 40 percent of cards only cover domestic rentals for up to 15 days. 
  • All Citibank, Chase (NYSE:JPM) and Discover cards provide global coverage. Ireland, Israel and Jamaica are the most common exclusions among other issuers.
In addition, most rental car contracts forbid drivers from driving on unpaved, unimproved roads. Although the survey noted there is only a 17-percent chance renters will get penalized for driving on a dirt or gravel road, it is still best to stick to the pavement.

Business credit cards offer similar benefits, though business cards seem to have policy details slightly enhanced; e.g., covering 31 days instead of 15-day rentals, and a few cards even offer the policy as primary coverage instead of secondary.

The WalletHub study included the following tips to minimize the cost and liability associated with renting a car.
  1. Call your insurance company to see if rentals are covered under your standard policy. Older policies may not offer this coverage. 
  2. Call your credit card company to ask if any limitations apply to your card’s coverage, relative to your rental plans. 
  3. Double-check with long-term rentals. They might not be covered by your auto insurance policy, due to time limits. 
  4. Decide whether to mix business with pleasure. Your personal auto policy – if it even covers rentals – only applies when the vehicle is used for personal use. So if you’re traveling for business check what other options are available for you. 
  5. Get a rental like your everyday ride. Your personal auto insurance is more likely to cover your rental if you get a vehicle of similar value to your own car. 
  6. Ask about adding an insurance rider (for a small fee) if your policy doesn’t cover a certain type of rental car. 
  7. Consider a non-owner auto insurance policy if you don’t have a car but drive from time to time. 
  8. Make a plan before you hit the rental counter. You may want to accept a rental company’s liability insurance and collision damage waiver if you don’t have personal auto insurance and your credit card won’t give you enough coverage. 
In any case, travelers will want to make an informed decision, not one based on panic at check-out.

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